OUTRAGE AS LINK SWITCHES TO 120 DAYS EOM

Australian print business owners are furious with global print broker Link Worldwide, which is set to impose 120 days end-of-month terms on its suppliers, the new diktat effective from 1 April.

Link has just sent an email to its suppliers, including ANZ printers, which says that due to its ‘strong revenue growth trajectory’ it is ‘standardising our payment terms across all entities worldwide to 120 days from the end of the month (120EOM)’ as part of its new ‘Supplier Growth Partnership (‘SGP’)’.

Infuriated local printers though see the move from a different perspective, telling Print21 it essentially them funding the Link business, through effectively bankrolling Link by giving it interest-free loans of between four and five months for work they have produced.

Link is dangling a carrot of extra revenue for suppliers, saying it is ‘prioritising higher spend allocation’, claiming the new SGP will ‘drive revenue growth opportunities for those supply partners who are engaged with us on our optimal commercial terms’.

ANZ print businesses are far from convinced though, with some vowing to end their relationship with the broker, and telling Print21 that neither their staff, landlords nor suppliers will wait between 120 and 150 days for payment. 

Industry employers group Visual Media Association is now going to develop an industry standard terms and conditions, for its members to provide to brokers and customers that demand extended terms. Kelly Northwood, CEO of VMA, said, “The VMA will now create an industry standard for terms and conditions that members can provide to customers, and to brokers. If we have a unified standard that print business abide by it will be beneficial to all.

“This is not the first time proposed procurement practices from brokers, or customers have veered away from the reality of business. It is a long way from best practice, and would impact the whole supply chain.

“As the industry association VMA will engage with Link, we will also write to Link and tell it that its proposed 120 days EOM terms are totally inappropriate for the Australian market."

Link Worldwide is a Hong Kong based print management company with a global footprint. It buys POS, print, and merchandise for its multi-national clients, some of it from Aussie printers. It is a huge business, with Link predicting revenue growth of another US$100m this year. Link was previously trading as ASL Global.

The rise of global aggregators has changed the dynamic of local markets. Long-standing major accounts and relationships between local printers and their customers can be swept away overnight when a global account is created and handed to a consolidator.

When ASL Global itself won the worldwide Coca Cola Amatil account a couple of years ago, local print operation Presfast took a big hit, as up until then almost half its work was for the local CCA operation, with the Presfast embedded ‘way upstream’ in CCA, according to its then owner Gavin Bloor. Presfast couldn’t recover from the sudden blow to its revenue when the work was handed to ASL, it went into voluntary administration, and was eventually bought by TMA.

The prevalence of smaller scale local print brokers is rapidly diminishing, as their business capabilities are swept aside by the big boys operating as BPOs - business process outsourcing operations, offering far more than print, but with print as a core part of their proposition.

Australian print business will have to deal with print management companies to an increasing extent, just recently what was the world’s biggest print company, RR Donnolley, bought one of the world’s biggest print management companies, Williams Lea, which was itself a former financial printer before it morphed into print management. Williams Lea operates around the world, and here in Australia, as does RR Donnolley, which has sales offices in Sydney and Perth.